In the past, the U.S. relied upon foreign oil to power a substantial portion of its energy needs. In the future, the country may develop a similar dependence, relying on a global rival to provide key materials needed for electric vehicles.
The shift toward electrification has left the U.S. auto industry in a vulnerable competitive state amid heightened economic and security tensions between China and the U.S., according to a report issued Thursday, Sept. 24, by a Washington, D.C., think tank.
China has consolidated control of key supply chains needed to produce EVs at global scale, according to the report from Securing America's Future Energy, a nonpartisan group of military and business leaders that examines the convergence of energy policy and the transportation industry.
The U.S., on the other hand, remains dependent on imports for key minerals and materials needed to produce batteries, an imbalance that "should be deeply concerning" to policymakers and auto industry executives, says Robbie Diamond, CEO of the group.
"The 21st century will be defined by the relationship between the United States and China, and the strategic and economic promises of transportation technologies ... are already at its center," he said. "To truly compete against China's ownership of these critical supply chains and new technology, we need to rehabilitate and transform our entire industrial ecosystem."
From mineral extraction to battery supply to EV manufacturing, China has established itself as the pre-eminent hub for EV-related business, the group says. By last May, 107 of the 142 lithium ion battery megafactories that exist or are under construction were located in China, according to the report, titled "The Commanding Heights of Global Transportation."
Further, the Chinese have focused on securing supplies of key materials used to produce battery cells, such as cobalt, lithium, nickel and graphite. China has 73 percent of the global share of production of lithium ion battery cells, per the report. The U.S., by comparison, controls 10 percent.